Porting mortgage

gjs010

Hi,
Probably stupid question.
I'm thinking about selling my house and moving next year.
I still have 13 years left on my mortgage.
I've heard about porting mortgages, but I wondered whether there was a certain time period that selling and buying had to be done by i.e I sell my property but perhaps I don't buy another for 2 months, will my bank still allow porting, or must you have to sell one day and buy another property the next? Or are they flexible and allow you to purchase within a time frame?

kingstreet

Most insist on simultaneous sale and purchase.

Others can offer a period of upto three months between the two.

Is your rate that good you want to keep it, as you would be porting the old rate to a new mortgage? The mortgage is actually redeemed on sale and a new one started when you purchase.

gjs010

I've currently got a decent rate with a two year fixed 2.49%. Deal runs out Sept 2015.
I thought about porting as a way that I could get out of any early payment charges, which I guess I would be liable for if I pay off the mortgage when I sell, even if I bought another property soon after and took out a mortgage with the same provider.

kingstreet

Yep. That's the idea.

You need to check your lender's policy. Most will want simultaneous sale and purchase.

You will need to meet your lender's current status and affordability criteria. There is no guarantee of a "port."

gjs010

Guess need to work out whether the early payment charges will be low enough to spend a couple of months mortgage free with relatives while i look for the "perfect" house and avoiding the chain game lol

Thrugelmir

gjs010 wrote: »

avoiding the chain game lol

As a cash buyer you may well still be in a chain.

JimmyTheWig

Thrugelmir wrote: »

As a cash buyer you may well still be in a chain.

True, but if you find the house of your dreams that you are happy to wait as long as it takes for, being at the bottom of the chain isn't too much of a problem.

gjs010

I phoned my mortgage provider, and they say that whenever I sell my property I would be liable for the early repayment charge (which wasn't as much as I thought it would be), however if I buy a new property within 4 months I could port the mortgage to the new property and reclaim the early repayment charge back from them.